Economic Collapse

[dickmilde]

I read that article on Zerohedge and I'm not sure what to think about a reversal in tech vs commodities.

I'm sue there are many other averages that can be turned upside-down given the extraordinary rise and fall in the tech stocks in recent time. Anyone that sold tech stocks a few months back and put the money into almost anything else would be ahead at this time. With stock values/ratios at extreme levels investors tend to revert back to "safe" investments so maybe that's what's going on.

A case can be made that near zero interest rates will make it very attractive to borrow and invest which results in higher prices. The real estate market is a classic example of what low interest rates do to asset prices. Investors are expecting higher interest rates which is a huge concern for the tech sector given that tech companies historically need a lot of money which will be more expensive.

Anyway... there is a lot going on that makes it difficult to make a case for using a Tech/CRB ratio as a forecasting tool. There does seem to be a correlation so it shouldn't be dismissed. Personally I recently went to a historically high level of cash in my account but even that has to be put in context. I have been exceptionally fortunate/lucky with my investments. I made a few rather large concentrated investments that I held for many years that have performed exceptionally well and at my age I don't have time to do it all again